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March 18, 2026 – 13:47

(Bloomberg) — Stocks and bonds erased gains after US producer prices accelerated unexpectedly and attacks in the Middle East rekindled fears about inflation ahead of the Federal Reserve’s meeting.

Futures for the S&P 500 fell 0.4%, wiping out an advance of 0.6%. The yield on 10-year Treasuries climbed one basis point to 4.21%. Brent rose 3.1% above $106 a barrel after Iran reported an attack on the South Pars gas field. The dollar gained 0.2%, while gold hit a one-month low.

The US producer price index rose 0.7% in February after a 0.5% gain in the prior month, according to Bureau of Labor Statistics data out Wednesday. An underlying gauge of wholesale inflation that excludes food and energy increased 0.5%.

Markets remain on high alert over the war and the risk that a near-closure of the Strait of Hormuz stokes inflation. How policymakers respond is now top of mind for investors, with the Fed expected to hold rates unchanged for a second straight meeting.

Fed Chair Jerome Powell will likely emphasize that officials need more time to see how long the conflict with Iran lasts and to assess how it might ripple through to growth and inflation. He’s also likely to highlight the elevated level of uncertainty and the Fed’s need to keep its options open.

“The market wants to understand where the Fed is leaning next,” said Stephanie Niven, portfolio manager at Ninety One. “Any shift in the median dot, any slight changes, will be really focused on.”

AI stocks in China got a lift after Nvidia Chief Executive Officer Jensen Huang said OpenClaw, an agent that uses large language models to perform tasks like hailing a ride and booking restaurants, was “definitely the next ChatGPT.”

Investors will allso focus on the results of memory chipmaker Micron Technology Inc. due after the close. The stock has soared more than 60% this year, the sixth-best performance in the S&P 500 Index, after jumping 239% in 2025.

Crude prices are rising again as the conflict in the Middle East shows no sign of ending. Iranian attacks on Israel and Arab states in the Persian Gulf continued overnight, with the Islamic Republic’s military vowing to avenge the assassination of security chief Ali Larijani.

Israel said Wednesday that Iranian intelligence minister, Esmaeil Khatib was killed. Earlier, President Donald Trump said the US could end the war with the Islamic Republic “in the near future.”

“Equity markets are following the oil price quite closely, and at this stage what we’re seeing is perhaps that they are pricing in the most positive outcome,” said Nina Stanojevic, investment specialist at St. James’s Place. “That, I think, leaves equity markets quite vulnerable.”

What Bloomberg Strategists Say…

“There has been considerable debate over whether risk assets have fallen enough. That this question is still being asked suggests sentiment has not reached peak bearishness and the worst is likely not over.”

— Skylar Montgomery Koning, macro strategist. For the full analysis, click here.

Corporate Highlights:

Unilever Plc, the maker of Hellmann’s mayonnaise, is in the early stages of considering a separation of its food assets as it seeks growth from beauty, personal care and wellbeing brands, people with knowledge of the matter said. UniCredit SpA Chief Executive Officer Andrea Orcel said his takeover bid for Commerzbank AG is designed to bring about negotiations between the stakeholders. BHP Group has appointed Brandon Craig as its new chief executive, as the world’s biggest miner grapples with the ripple effects of a war in the Middle East, a cooling Chinese economy and the wider industry’s shift toward growth, particularly in copper. Tencent Holdings Ltd. posted a 13% rise in quarterly revenue, underscoring solid momentum in its core gaming and advertising units while it ramps up a bet on agentic AI. Samsung Electronics Co. is considering a shift toward multi-year contracts for memory chips, a much longer timeframe than is typical that may help stabilize supply and ease concerns about a shortage of the essential components. Some of the main moves in markets:

Stocks

S&P 500 futures fell 0.4% as of 8:45 a.m. New York time Nasdaq 100 futures fell 0.4% Futures on the Dow Jones Industrial Average fell 0.2% The Stoxx Europe 600 fell 0.3% The MSCI World Index was little changed Currencies

The Bloomberg Dollar Spot Index rose 0.2% The euro fell 0.2% to $1.1516 The British pound fell 0.2% to $1.3324 The Japanese yen fell 0.2% to 159.36 per dollar Cryptocurrencies

Bitcoin fell 2.9% to $72,382.71 Ether fell 3.8% to $2,239.35 Bonds

The yield on 10-year Treasuries advanced one basis point to 4.21% Germany’s 10-year yield advanced two basis points to 2.92% Britain’s 10-year yield advanced two basis points to 4.71% Commodities

West Texas Intermediate crude rose 0.7% to $96.85 a barrel Spot gold fell 2.6% to $4,876.92 an ounce This story was produced with the assistance of Bloomberg Automation.

–With assistance from Sujata Rao, Subrat Patnaik, James Hirai and Neil Campling.

©2026 Bloomberg L.P.